Singapore High Court, 26 April 2018, China Machine New Energy Corp (CMNC) v. Jaguar Energy Guatemala LLC [2018] SGHC 101

On 26 April 2018, the Singapore High Court refuses to set aside an award in favour of Jaguar Energy Guatemala. The dispute originated in the construction of a coal-fired power plant in Guatemala by CMNC. In both contracts concluded by the parties, the arbitration clause provided for an expedited arbitral procedure, with the tribunal required to produce an award within 90 days after the president of the arbitral tribunal’s appointment with the possibility of extending the deadline by another 90 days.

CMNC challenged the award on the grounds of natural justice, good faith, and public policy. First, the Court rejects CMNC’s argument that the “attorney-eyes only” order granted by the tribunal constituted a breach of natural justice mainly because of the procedural safeguards put in place. The Court finds “vital to the analysis” that the alleged prejudice suffered by CMNC in connection with the AEO order arose from the lack of time to review documents. As emphasized by the Court, although the parties agreed to multiples delays, the tribunal was bound to give effect to the agreed-upon expedited arbitration clause.

The Court also finds that Jaguar did not breach an “implied duty to arbitrate in good faith” through alleged guerilla tactics including harassment, intimidation of witnesses and the seizure of the construction site, mostly because all these acts predated the initiation of the arbitration. Allegations that the award violated public policy because the tribunal had declined to investigate allegations of corruption against a Jaguar representative in Guatemala are also rejected as there was no nexus between the alleged corrupt acts and the arbitration.

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